Noun
nepotism - When those with power or influence favor relatives, friends, or associates, such as by giving them jobs or ruling in their favor.

The public was disappointed by the nepotism of the newly elected mayor, when they saw that his whole government was filled with incompetent friends and relatives.
wedge - A piece of material with a thick end that tapers to a thin edge, used to split, support, or secure things; also something that forces separation or division between people or groups.

The disagreement drove a wedge between the two longtime friends, and they really didn't enjoy spending time together anymore.